Senator McGAURAN
—My question is directed to the Assistant Treasurer. Is the minister aware of industrial action being taken today by building workers to protest about the Treasurer's decision concerning the taxation of award transport payments made to on-site building workers? Can the minister advise the Senate of the rationale for the decision and whether the action being taken today will influence the government to change its position?

Senator SHORT
—I thank Senator McGauran for his question. Yes, I am fully aware of the industrial action being taken today. It is totally unwarranted action. I welcome this opportunity to give the Senate the background to the matter.

Senator SHORT
—Yes, it is a very important question, and it deserves a considered and responsible answer. The Treasurer announced on 2 May that this government would not be proceeding with the announcement of his Labor predecessor—that is, Mr Willis—in December 1995 to change the tax act to give tax exempt status of $7.60 a day to award transport payments for construction workers. I have to say to Senator McGauran and the Senate that that announcement by the former Treasurer, Mr Willis, was not only rash but also cowardly. It was rash because it could not be justified on the grounds of rationality or equity. It gave building workers special tax treatment not offered to any other workers who also receive award transport payments. A range of other employees receive award transport payments, including engine drivers and firemen, aircraft engineers and pilots, bank staff, insurance industry employees and employees in the television and timber industries.

Senator SHORT
—I pick that one up. `Give it to them as well,' says Senator Burns. Give them a free kick against every other Australian is what he is saying. The headlines in the media at the time of the announcement said things such as `Building workers win big tax breaks'. In other words, the media was quite correctly highlighting that the building workers were getting a tax break not available to any other workers, including others who received award transport payments.

Mr Willis's announcement, as I said, was cowardly as well. It caved in to pressure from some of his union mates. At the time of the announcement, in December last year, the unions claimed Labor's decision as a major victory. Not only was it a special deal; it was a special deal stitched up to buy votes. It was all about the forthcoming election. A report in the Australian Financial Review of 5 December—I think the day after the Willis announcement—quoted a union official as saying, `A victory for commonsense leading up to the forthcoming federal election.'

The rationale for our decision is very straightforward: under us all workers receiving award transport payments will be taxed in exactly the same way. The payments will be taxable, but workers can claim for deductible travel expenses. There will be equity; there will be no special treatment for union mates. We will stick by the law as it has always been. It says that those amounts are taxable. We are not changing the law.

I stress that we are not changing the law. Our decision is to maintain that part of the taxation law which has been there for very many years. Under that law, award transport allowances are and have always been taxable. Whether the tax was ever actually paid on the amounts is a separate issue that has to do with—

Senator SHORT
—Yes, I would like some, actually. Perhaps Senator McGauran could give me a supplementary question. That has to do with the administration of the taxation law. Treasurer Costello announced on 2 May—(Time expired)

Senator McGAURAN
—Minister, do you have any further comment to make on the government's rationale in making its decision?

Senator SHORT
—I thank Senator McGauran. That is a very perceptive supplementary question. As I was saying, Treasurer Costello announced on 2 May that we are keeping the current law. We are not proposing to change the law, which is what the unions seem to be implying. The former Treasurer's, Willis's, special deal for building workers—it disadvantaged, I must point out, each and every other worker in Australia, including in particular those who received award transport payments—required a change in the law. Willis wanted to change the law. He never got around to doing it. The suggestion that we are changing the law, that we are doing something to affect the longstanding situation, is simply incorrect. Our decision is to maintain the law as it has always been. It has always been accepted as fair and equitable by the overwhelming majority of Australia.

The DEPUTY PRESIDENT
—Order! Senator, your time has expired, and you should refer to Mr Willis as `Mr Willis'.